It looks like it's nearly there. I followed a new Orc around and he spent a couple minutes idly walking around the dungeon, then decided to go train, took a couple swings, went to equip steal armor then immediately swapped for bone, went to train again for a couple swings, and finally equipped a shield. I made sure the best equippable items were in storage so everything was there. Kinda weird he equipped steal armor then bone armor when I'd expect he'd just pickup what was the best available.

I can second that, but I think the problem lies deeper. It's because prioritizing system doesn't work that efficient. For example Imps will go digging or taking wounded to bed or prisoners to prison only after they finish certain work they do like claiming tiles - they'll never interrupt their work because suddenly a new event that requires a quick response from them happens.

Yeah, the thing is that if we decide to break ongoing jobs it could get messy, a imp could start reinforcing walls, then something else with a higher priority will come up making him start to do that, and then another and so on. And in the end the imp would have started 10 different jobs without completing a single one. A job usually takes between 5 - 15 seconds to complete. I think we saves a lot of time to him complete it than having to re-prioritize, especially as we usually have 20+ imps running around. They complete jobs once every second.

I see. Than I think I have some suggestions for Imps. I will make a thread about Imps in separate thread.

If it comes to this bug I think it's solved. All creatures when their last task is done and are not idle are going to storage and wear armour or/and weapon that was set to have the highest priority for that type of creature.

Yea, and what Mello said about that one of the Orcs were doing some swinging etc. before it finally went to equip himself might be the only Orc assigned to a certain room Mello built in which Orcs were supposed to do a job there. The same happens to main Rally Flag (and unfortunately for us it doesn't apply for Creature Rally Flag - which I elaborated HERE).